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OACETT IEPPE Exam Dumps - Actual Questions Answers

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OACETT IEPPE Questions Answers

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IEPPE Questions and Answers

Question # 1

Brown and Green have a concept for a new survey measuring instrument based on their many years in the Civil Survey field. They want to establish a business to raise capital, design, manufacture, and market this new instrument. Both Brown and Green are well established, are in their mid-50s, and have no family members who would be prepared to take over the business when they are ready to retire in about 10 years.

Once the business is running and profitable, which business form facilitates getting money out of the business while maintaining the business as a going concern?

A.

A partnership, because they can declare dividends, sell some of their shares, and/or pay themselves a salary.

B.

A corporation, because they can declare dividends, sell some of their shares, and/or pay themselves a salary.

C.

A sole proprietorship, because they can declare dividends, sell some of their shares, and/or pay themselves a salary.

D.

A joint venture of two sole proprietorships, because they can declare dividends, sell some of their shares, and/or pay themselves a salary.

Question # 2

Brown and Green have a concept for a new survey measuring instrument based on their many years in the Civil Survey field. They want to establish a business to raise capital, design, manufacture, and market this new instrument. Both Brown and Green are well established, are in their mid-50s, and have no family members who would be prepared to take over the business when they are ready to retire in about 10 years.

If Brown and Green had assets and needed to raise money for their new venture, which form of business might make it easier to obtain a bank loan?

A.

A joint venture because they would not have to personally guarantee the loan.

B.

A corporation because they would not have to personally guarantee the loan.

C.

A partnership because they would not have to personally guarantee the loan.

D.

Either a corporation or partnership as long as they personally guaranteed the new business loan; although generally, a corporation has more flexibility.

Question # 3

Brown and Green have a concept for a new survey measuring instrument based on their many years in the Civil Survey field. They want to establish a business to raise capital, design, manufacture, and market this new instrument. Both Brown and Green are well established, are in their mid-50s, and have no family members who would be prepared to take over the business when they are ready to retire in about 10 years.

In your opinion, is there justification for starting up with one business form and converting to another form later?

A.

Yes, there is justification for starting up with one business and converting to another form because it provides the owners with interesting variety.

B.

No, there is no justification for starting up with one business form and converting to another form because it is too expensive.

C.

Yes, starting out as a partnership might be the easiest/cheapest way to get the business started and it could be switched to a corporation for liability protection and tax advantages when growth begins.

D.

No, it is bad business practice to change the form in which a business is being operated as it creates confusion among clients and suppliers.

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